Wednesday, April 01, 2009

Ford's Concerns

The Wall Street Journal has an interesting article about Ford's concerns regarding the federal intervention at GM and Chrysler. Ford's concerns appear very legitimate. First, they recognize the threat to their own supply chain if GM and/or Chrysler file for bankruptcy. Perhaps more importantly, they worry that a bankruptcy filing will enable GM and Chrysler to start anew with a much more competitive cost structure, perhaps giving them a leg up on Ford. I think the federal government will have to tread carefully here. While they may wish to assist GM and Chrysler, they certainly should not do so in a way that penalizes Ford. After all, Ford represents the only one of the Big Three who actually has managed to avoid having to ask for federal bailout funds.